KRNT Butterfly Strategy
KRNT (Kornit Digital Ltd.), in the Industrials sector, (Industrial - Machinery industry), listed on NASDAQ.
Kornit Digital Ltd. develops, designs, and markets digital printing solutions for the fashion, apparel, and home decor segments of printed textile industry in the United States, Europe, the Middle East, Africa, the Asia Pacific, and internationally. The company's solutions include digital printing systems, ink and other consumables, associated software, and value-added services. Its products and services include direct-to-garment printing platform for smaller industrial operators to mass producers; NeoPigment ink and other consumables; QuickP designer software; and maintenance and support, consulting, and professional services. The company serves decorators, online businesses, brand owners, and contract printers. Kornit Digital Ltd. was incorporated in 2002 and is headquartered in Rosh HaAyin, Israel.
KRNT (Kornit Digital Ltd.) trades in the Industrials sector, specifically Industrial - Machinery, with a market capitalization of approximately $763.7M, a beta of 1.76 versus the broader market, a 52-week range of 11.93-23.48, average daily share volume of 329K, a public-listing history dating back to 2015, approximately 715 full-time employees. These structural characteristics shape how KRNT stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.76 indicates KRNT has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position.
What is a butterfly on KRNT?
A long call butterfly buys one lower-strike call, sells two ATM calls, and buys one higher-strike call, paying a small net debit for a defined-risk position that maxes out if the underlying pins the middle strike at expiration.
Current KRNT snapshot
As of May 14, 2026, spot at $15.75, ATM IV 50.90%, IV rank 7.61%, expected move 14.59%. The butterfly on KRNT below is built from the same end-of-day chain, with strikes snapped to listed contracts and premiums pulled from the bid/ask midpoint at a 35-day expiry.
Why this butterfly structure on KRNT specifically: KRNT IV at 50.90% is on the cheap side of its 1-year range, which favors premium-buying structures like a KRNT butterfly, with a market-implied 1-standard-deviation move of approximately 14.59% (roughly $2.30 on the underlying). The 35-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated KRNT expiries trade a higher absolute premium for lower per-day decay. Position sizing on KRNT should anchor to the underlying notional of $15.75 per share and to the trader's directional view on KRNT stock.
KRNT butterfly setup
The KRNT butterfly below is built from the end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With KRNT near $15.75, the first option leg uses a $14.96 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed KRNT chain at a 35-day expiry; the cross-strike IV skew is reflected directly in the per-leg values rather than approximated. Quantity sizing assumes one contract per option leg (or 100 KRNT shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $14.96 | N/A |
| Sell 2 | Call | $15.75 | N/A |
| Buy 1 | Call | $16.54 | N/A |
KRNT butterfly risk and reward
- Net Premium / Debit
- N/A
- Max Profit (per contract)
- Unbounded
- Max Loss (per contract)
- Unbounded
- Breakeven(s)
- None on modeled curve
- Risk / Reward Ratio
- N/A
Max profit equals the wing width minus net debit times 100 (reached when the underlying pins the middle strike); max loss equals the net debit times 100. Two breakevens at lower-wing plus debit and upper-wing minus debit.
KRNT butterfly payoff curve
Modeled P&L at expiration across a range of underlying prices for the butterfly on KRNT. Each row is one sampled price point from the computed payoff curve; the full curve uses 200 price points internally before being summarized into 10 rows here.
When traders use butterfly on KRNT
Butterflies on KRNT are pinning bets - traders use them when they expect KRNT to settle near a specific level at expiration (often the prior close, a round number, or the max-pain strike) and want defined-risk exposure to that outcome.
KRNT thesis for this butterfly
The market-implied 1-standard-deviation range for KRNT extends from approximately $13.45 on the downside to $18.05 on the upside. A KRNT long call butterfly is a pinning play: it pays maximum at the middle strike if KRNT settles there at expiration, with the wing legs capping both the cost and the maximum loss to the net debit. Current KRNT IV rank near 7.61% sits in the lower third of its 1-year distribution, where IV often re-expands toward the mean; this favors premium-buying structures and disadvantages premium-selling structures on KRNT at 50.90%. As a Industrials name, KRNT options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to KRNT-specific events.
KRNT butterfly positions are structurally neutral / pin (limited-risk, limited-reward); the modeled P&L assumes European-style exercise at expiration and ignores early assignment, transaction costs, dividends paid before expiry on the stock leg (when present), and the bid-ask spread on the listed chain. KRNT positions also carry Industrials sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move KRNT alongside the broader basket even when KRNT-specific fundamentals are unchanged. Always rebuild the position from current KRNT chain quotes before placing a trade.
Frequently asked questions
- What is a butterfly on KRNT?
- A butterfly on KRNT is the butterfly strategy applied to KRNT (stock). The strategy is structurally neutral / pin (limited-risk, limited-reward): A long call butterfly buys one lower-strike call, sells two ATM calls, and buys one higher-strike call, paying a small net debit for a defined-risk position that maxes out if the underlying pins the middle strike at expiration. With KRNT stock trading near $15.75, the strikes shown on this page are snapped to the nearest listed KRNT chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are KRNT butterfly max profit and max loss calculated?
- Max profit equals the wing width minus net debit times 100 (reached when the underlying pins the middle strike); max loss equals the net debit times 100. Two breakevens at lower-wing plus debit and upper-wing minus debit. For the KRNT butterfly priced from the end-of-day chain at a 30-day expiry (ATM IV 50.90%), the computed maximum profit is unbounded per contract and the computed maximum loss is unbounded per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a KRNT butterfly?
- The breakeven for the KRNT butterfly priced on this page is no defined breakeven on the modeled curve at expiration, derived from end-of-day chain premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The current KRNT market-implied 1-standard-deviation expected move is approximately 14.59%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a butterfly on KRNT?
- Butterflies on KRNT are pinning bets - traders use them when they expect KRNT to settle near a specific level at expiration (often the prior close, a round number, or the max-pain strike) and want defined-risk exposure to that outcome.
- How does current KRNT implied volatility affect this butterfly?
- KRNT ATM IV is at 50.90% with IV rank near 7.61%, which is on the low end of its 1-year range. Premium-buying structures (long call, long put, debit spreads) are relatively cheap in this regime; premium-selling structures collect less credit per unit risk.